White Paper Drafting Sessions The Fourth Meeting of the Latin American Coporate Governance Roundtable   White Paper Drafting Sessions Paulo D. Villares ibgc@ibgc.org.br  

White Paper Chapter 5.III and 5.V The Fourth Meeting of the Latin American Coporate Governance Roundtable White Paper Chapter 5.III and 5.V The Role of the Stakeholders and Reponsibilities of the Board

Relationships Suppliers Clients Employees Government Community OWNERS BOARD OF DIRECTORS FISCAL COUNCIL CEO OFFICERS INDEPENDENT AUDITORS Suppliers Clients Employees Government Community Labor Union Selection/Accountability Informations Occasional relationship STAKEHOLDERS

Board of Directors Defining strategies; Electing and removing the CEO; Defining Officers remuneration; Supervising Officers and Management; Selecting Independent Auditors; Calling together Annual General Meeting Corporate Law 6.404/76 - section 142

IBGC IBGC IBGC IBGC IBGC IBGC CODE OF BEST PRACTICE OF CORPORATE GOVERNANCE

Best Practices The Chairman and the CEO should be two different persons; Experience, knowledge and diversity among board members; Size of the Board: 5 to 9 members; The majority of the Board should be independent; Board member’s term of office should be one year and reelection accepted.

Best Practices There should be at least 6 board meetings annualy; Annual Evaluation of the Board and/or Board Members; The CEO should indicate Officers for approval by the Board of Directors; Independent Auditors – selection, scope definition, fees and report practices; Auditing or consulting; Board Committees: audit, compensation, nominating and corporate governance.

Issues not considered in the White Paper Board member’s term of office Board Size Board diversity (knowledge, experience and background) Executives/board members – conflict of interests Chairman and CEO Executive sessions

Remarks Fiscal Councils Audit Committees (92) - Alternate Directors

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